The Finance Ministry termed the increase late on Monday night as an increase in Retail inflation dips to 7% in July from 6.71% in August as ‘moderate’, and attributed this to an unfavorable base effect and a rise in food and fuel prices, which it called a “transient component” of consumer price inflation.
Core inflation, which does not include these ‘transient components’ of food and beverages as well as fuel and mild inflation, was recorded at 5.9% in August, falling below the tolerance limit of 6% for the fourth consecutive month, the ministry asserted. Gave.
“Despite erratic monsoon and negative weather in vegetable prices, food inflation in July is still lower than the April peak of the current year. In order to reduce the prices of edible oils and pulses, tariffs on imported goods have been rationalized from time to time and stock limits on edible oils have been placed to avoid hoarding,” the ministry said.
Emphasizing that the inflation in “oils and fats” and “pulses and products” has risen to 5.62% and 2.52% respectively, the ministry said that the government has increased the rate of “food items like wheat flour/atta, rice, maida, etc.” Ban on export of products. Stabilize domestic supply and check price rise.”
“The impact of these measures is expected to be felt more significantly in the coming weeks and months,” it underlined.
“With global inflationary pressures, inflationary expectations in India with stable core inflation remain stable,” the ministry said, citing a July 1 survey by IIM-Ahmedabad. From 5.17% in June’. One basis point is equal to 0.01 percentage point.
“The inflation expectation has come down to below 5% after 17 months,” the ministry said. “Prices of key inputs like iron ore and steel have calmed down in global markets. This, coupled with the measures taken by the government. Rationalization of tariff structure of inputs to augment domestic supply, has helped to keep cost push inflation in consumer goods under check,” it concluded.